India’s Fuel Demand Slips Again After A One-Month Pause
A mobile mechanic transfers gasoline to a vehicle. (Photographer: Carlos Becerra/Bloomberg)

India’s Fuel Demand Slips Again After A One-Month Pause

Aggregate demand for petroleum products, including auto and industrial fuels, fell in November after rising for the first time in seven months in October despite an uptick in economic activity.

Usage of petroleum and related products declined 3.7% year-on-year to 17,834 thousand metric tonnes in November, according to data from the Petroleum Planning and Analysis Cell.

The combined consumption of petrol, diesel, liquefied petroleum gas, naphtha and pet coke, among others, was 85.6% of last year’s level in April-October—reflecting the prolonged impact of the harsh lockdown implemented in India to contain the Covid-19 outbreak.

According to the data by Petroleum Planning and Analysis Cell, here’s how demand for key fuels fared in November:

Petrol & Diesel Consumption

Consumption of petrol, however, rose for the third straight month in November, aided by the preference for personal mobility following the pandemic, the festive season and the upcoming marriage season. Usage of the fuel for passenger cars and two-wheelers rose 5.1% year-on-year to 2,664 thousand metric tonnes.

Sales of passenger vehicles and two-wheelers in the country grew 4.6% and 13.4% year-on-year, the PPAC said in its report without specifying the source for the data.

Diesel consumption fell by 6.9% after growing in October, largely because of the agitation by farmers against agrarian laws, affecting road and rail traffic in and around Punjab, Haryana and Delhi. The festive season was also a factor as trucker and tanker crews traditionally go on a holiday during this period. Rail traffic is yet to return to pre-Covid levels.

Other Fuels

Kerosene consumption declined by 17.8% year-on-year in November, as all union territories except Jammu and Kashmir and Ladakh, and states of Andhra Pradesh, Delhi, Haryana, and Punjab have been declared kerosene free. On the other hand, consumption of liquefied petroleum gas rose 4.1% year-on-year last month.

With international air traffic curtailed because of global restrictions to prevent the spread of the pandemic, consumption of aviation turbine fuel slumped by 47.5% over a year ago.

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